Feds to pay 3.7% more on average for health premiums next year

Sep. 20, 2012 - 02:19PM
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OPM Director John Berry said it's important to deliver competitive rates and benefits through an efficiently run program. (Tim Grant / OPM)

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Health care premiums for federal employees and retirees will climb an average 3.4 percent next year — a welcome dip in cost growth that was an average 3.8 percent higher this year.

The share of premiums paid by federal employees will increase an average of 3.7 percent, and the government’s average share will go up 3.3 percent, the Office of Personnel Management said Thursday.

OPM said there will be no significant changes to benefits next year under the Federal Employees Health Benefits Program.

The government will pay an average 72 percent share of premium costs.

“I am pleased that we were able to keep the average increase low again this year,” OPM Director John Berry said in a statement. “It is important that we deliver competitive rates and benefits through an efficiently run program to attract and retain top talent in the federal service.”

While the 2013 premium increase will be the lowest since 2008 — when premiums went up 2.1 percent — the American Federation of Government Employees said it is still too much for feds to bear as they have endured two years of frozen pay scales. Federal employees’ pay scales have not increased for the past two years, and will stay frozen until Congress passes a final budget, which will not happen until next March at the earliest.

“Congress and the administration have decided to turn the federal workforce into a ‘fixed income’ population that simply cannot afford another cent toward already-inflated FEHBP premiums,” AFGE National President J. David Cox said. “How can they be expected to afford another increase in FEHBP rates while their salaries don’t increase? It’s the same as a pay cut.”

The open season to sign up for health, dental and vision benefits and flexible spending accounts will go from Nov. 12 to Dec. 10. Roughly 8.2 million federal employees, retirees and their families will be able to choose from among 230 health plans. That is up from 206 plan choices available in 2012.